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“I think to some degree entrepreneurs are sort of born, but without question good entrepreneurs require really good mentorship from outside sources.”

Interview by Mike Sullivan
Mike:
Hi, I’m Mike Sullivan. Thanks for joining us on M.O., where we feature small business owners and entrepreneurs and then bring you hints, tips, insights, and perspectives on what it takes to be successful.
Today joining us is Eric Tobias. He is the President of iGoDigital. He’s responsible for guiding the company’s strategic direction and day-to-day operations. Prior to iGoDigital, he was a co-founder of Batteries.com and served as the VP of Sales and Marketing at Technuity.
Eric, thanks for joining us. To get started, can you tell us a little bit about what iGoDigital is and what you’re all about?
Eric:
Sure. iGoDigital is a software provider in the personalization and product recommendation space. We really have two primary products. We have what we call our guided selling tool platform, and it replicates the experience of talking with a trusted adviser or your smartest friend where we ask the consumer a series of questions and based on how they respond to those questions, we make some product recommendations and that’s called guided selling.
Then our secondary product is what we called dynamic product recommendations. Typically we’ll display those on a web site or within the content of an email that a retailer will send. What we’re doing there is we’re observing the user’s behavior as they move throughout the site. We’re building a unique profile to that individual based on that behavior.

There are all different types of things we’re looking at. We’re looking at product attributes that a user has looked at. We’re looking at categories. We’re looking at do they have any price affinities? Do they have any color affinities? Do they always look at new items? Do they always look at items on sale? We’re building this profile and then using that to display products that we think that user might be interested in buying.
Those two products can work independently or they can work together. So as I answer some questions in a guided selling tool that influences my profile for product recommendations and vice versa. That’s really what we’re focused on. We deal with six of the top ten leading websites, everybody from Amazon to Walmart to Best Buy, but we also deal with and have the fortune to work with a lot of niche retailers as well. So that’s kind of a quick review on iGoDigital.
Mike:
Where did the concept for iGoDigital originate, or at what point did you decide to build a business around this idea?
Eric:
In 2004, we developed a relationship with Best Buy. That relationship came out of some prior business experience that I had, and they were looking for a way to improve their online experience and help guide and direct shoppers to products in a way that they were doing in their retail store environments. They wanted to take that experience and bring it online.
There was an opportunity to create a better way of doing that, and we kind of set out from there on the path. Our initial product in 2004 was really a product finder based around specific attributions, and we did a lot of work in compatibility of products. We did ink and toner finders, computer memory finders, and those type of experiences, and then that led us down the road of developing one of the products that we still consider a flagship today, and we call that was guided selling.
Guided selling was around the concept of asking customers questions about how they might use a product, walking them through a step-by-step approach, and as they answered those questions, and then ultimately delivering a great product recommendation.
What we found through that experience was as consumers answered those questions and ultimately selected products and bought products, we were able to get ahead of that curve and sort of predict how they would end up purchasing based on their behavior prior to engaging with the questions and answers. So that led us to our second product, which we actively market today, which is dynamic product recommendations, which are injected into a site or into a retailer’s e-mail. So that’s kind of a long story of how we got here.
Mike:
Your client list includes Walmart, Nokia, Best Buy. How does one go about landing such large and high profile clients?
Eric:
I don’t know if there’s a secret sauce or not. My background prior to iGoDigital, I was involved in a company called Batteries.com, which was an online retailer focused in the power space, and we subsequently started a secondary company called Technuity, which was also in the power space, but more on the B2B side. Technuity, that was a licensee of Energizer, and we manufactured and sold products under the Energizer name, and as such, developed a lot of relationships with big box retailers – Best Buy, Walmart, etc.
My background really was selling and marketing to those folks. When we started iGoDigital, we took a very similar approach. Our first customer was Best Buy, and we went shortly thereafter to Circuit City and developed a relationship with Walmart and Dell and Staples and on and on. That’s sort of where my comfort and expertise lie really understands the unique challenges that those folks have because of their size and scale and scope. We built a management team that also has that background.
So how we go about it, a lot of relationship building, a lot of listening. Those kinds of companies tend to have very complex organizations, but they’re trying to solve big, futuristic problems. We have to be nimble and we have to be responsive, but it kind of starts with listening.
Eric Tobias - iGoDigital
Mike:
One of your specialties is personalized product recommendations. How are we seeing social networking playing into that now and into the future?
Eric:
We have a number of customers that are trying to figure out social and how it relates to the overall user experience of a site. When we observe a user’s behavior on a site and we’re watching their click behavior and ultimately using that behavior to influence the profile that we’re creating about that individual, one of the things we’re doing is we’re looking at aggregate wisdom of the crowd. How are the crowds behaving and what does that behavior tell us about this particular individual? We see an opportunity to layer social behavior, social demographic, social graph on top of that wisdom of the crowd.
As an example, if one of our algorithms is people who bought this product also bought these products, as a way of making a product recommendation, we might have a set of one hundred products that might fit that criteria. If we then apply the filter or the lens of people that bought this within your social network also bought these, that provides a more defined, a more relevant subset of products.
One of the things we consistently hear in our user experience work from consumers is there is a trust issue with recommendations in general. Consumers want to know, are you really recommending that for me, or are you recommending that because you’ve got 10,000 of them in the warehouse and you want to get rid of them?
So we kind of think the big vision here is to be able to take someone’s social profile and leverage and utilize that to make sure that the recommendations have a higher trust factor when they’re delivered to the end user.
Mike:
You were the co-founder of Batteries.com, which at its core is a fantastic domain name. What is your perspective on the value of domain names in business today?
Eric:
Batteries.com was a great experience. We did have a great domain name, so thank you for saying that. I think a domain is really important. At Batteries, we exited that business in 2007, so my data points are slightly outdated. But over 50% of our traffic came from people typing in the URL.
It was just such an important aspect of our marketing efforts. As we grew that business, really from starting it out of a bedroom to being a consistent Internet retailer top 500 site, a big part of our strategy was the domain name. I think today it’s extremely important. I think the amount of noise that exists in terms of the number of options is just massive.
One of the foundations of iGoDigital, one of the reasons we founded the business was this idea that there were just so many products coming to market, how would a consumer figure out what to buy and what was right for them? I think the same is true with consumers figuring out where to shop.
We all know the Walmarts and the Amazons and the Best Buys of the world. As niche sites come into play, it’s hard to remember those. Places where I shopped a year ago and had a great experience and want to go back and maybe buy something else again, it’s just hard to have that top of mind brand awareness. I think for all those reasons a great domain name really moves the needle much faster than maybe some alternative marketing tactics might.
Mike:
Batteries.com sold to Audiovox. What goes into the decision to sell a business or to continue developing it?
Eric:
I think there are a lot of things that go into that decision. If I draw on my own experience at Batteries, it was a number of different things. It was how we felt the market may be headed. We were very bullish on that market, and therefore we thought that there were going to be a couple decision points – how much capital it might take to continue to grow a business. One of the things that I’ve learned and certainly others who are smarter than me know, as you’re growing a business and gaining revenue and gaining profits, it actually costs more and more to operate a business the bigger it gets. So some of those considerations come into play.
I think at Batteries I had four other co-founders, and so dynamics of a management team come into play and just everybody’s individual life story comes into play. When you have different people at different ages, some people starting their career and some people maybe on the back half of their career, there are just different motivations in terms of how you want to be spending your days and what you want to be doing. So I think that’s a factor.
I think overall market conditions play into those kinds of decisions and are valuations being maximized in particular verticals and what potential outlooks are for that. Access to capital, as I mentioned, I think is another big one.
I think ultimately, in my particular instance things had just sort of run their course. We certainly were growing the business year-over-year, and we were really on a nice trajectory. But we had been doing it for seven or eight years. For an entrepreneur, it takes a lot out of you. Starting and operating a business, especially a bootstrap ground-up business, it just takes a lot out of you. It takes a lot of you personally and professionally, and sometimes it’s just time for a change.
Mike:
Clearly you have some great business experience. Do you feel like entrepreneurs are born or are they developed over time?
Eric:
I think this is a hard one. I’ve spent a lot of time thinking about this. I’m involved in some funding of startups and try to participate in that. As I sort of look at other entrepreneurs, either who are just starting out or who have experience, that’s a question I ask myself a lot.
I think in my case it’s a little of both. I still remember having my first job at the age of 12. When other kids were maybe spending their summers going to camp or doing whatever, I was always kind of focused on mowing more lawns or working longer hours at the mall or whatever the case may be, which isn’t to say I didn’t do my share of camps. But I’ve just always been an entrepreneur from as far back as I can remember.
I think to some degree entrepreneurs are sort of born, but without question good entrepreneurs require really good mentorship from outside sources. They require great experiences and access to thought leaders, and all those things are sort of the made portion of that equation. So I really believe it’s both. I think that the best entrepreneurs have it in them, but they approach it as if they’re learning from scratch every single day.
Mike:
How important is a team in business? Would you recommend starting as a sole proprietor or having some partners that can contribute some complementary skills to you?
Eric:
We’re all sort of made of our experiences. So my experience has been in both of those scenarios. I’ve experienced working with a larger ownership structure and management team, and then I’ve experienced starting a business as an individual. I think maybe the best answer is the one I haven’t done yet, which is maybe a hybrid of the two.
I think if you can find a situation where you have one or two partners, kind of a two or three person founding group, I think that may be the ideal situation. I definitely think a group is beneficial and helpful. I think it’s really hard to do it on your own. To have a sounding board and to have other people to draw on, both inspiration and motivation, I think that’s really great.
At the same time, I think when you get a larger group of five, six, seven founders, a lot of times that’s too many cooks in the kitchen and too many voices. I think there’s something to be said about a smaller group with more defined roles.

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